Virtual Open House Webinar Series – EMEA
The webinar focuses on hiring, on-boarding, employment contracts, employment law, benefits, payroll, termination and more in Europe, the Middle East, and Africa (EMEA)
Read the full transcript of questions and answers below. Download the presentation here.
OPEN HOUSE QUESTIONS AND ANSWERS:
May an employer insist on employees obtaining medical insurance as a contingency of employment?
No, absolutely not. In terms of employment, you can offer medical insurance. From the statutory perspective, if it is mandatory (in your country), then you have to contribute to it. There is no provision for enforcing an employee to obtain medical insurance.
What is the rule for the Czech Republic’s taxation on gifts from employers?
The taxation rule in the Czech Republic is very similar to most of the European Union’s fringe benefit tax requirements in that they are usually due at the end of each year. It is advisable to make sure that you are keeping track of these gifts and all other items that fall under the fringe benefit tax.
Can you help me understand any possible double tax implications as a UK company employing people and paying employment taxes in Greece?
The important question, really, is whether they are Greek nationals or otherwise have the right to work in Greece, and whether you are employing them (or executing the employment contract), in Greece as a jurisdiction. If so, then they are obviously subject to Greek taxes and Greek statutory benefits. I think from the perspective of ex-patriots, such as UK citizens who are work permitted to work in Greece, according to the UK tax rules, you have to spend specific amounts of time outside UK to enjoy them. Certain taxation holidays in the UK have particular implications, but these are often employee-mandated requirements, not employer-mandated.
A UK employee wants to use their own pension. How do you set it up to make it compliant with the government pension requirements?
A UK employee can opt to use their own pension plan. However, it must be in compliance with the HMRC guidelines and there are specific processes that must be followed while ensuring the compliance of the plan.
What are the payroll rules, particularly for London and Luxembourg?
We are talking about working in the UK or working in Luxembourg. The employees are subject to the payroll taxes and statutory benefits payments that are required in those jurisdictions and that is processed and calculated through a compliant payroll systems and paid accordingly. It is very specific to the jurisdiction and the country they are working in and residing in.
What is the competitive primary and secondary caregiver leave policy? What added benefits are companies offering?
In the UK, for example, there are many types of caregiver leaves, and most companies will go with statutory plans. What we have not seen very often is companies adding to the caregiver plan, because in most countries this is taken care of.
How are the UK and the Netherlands taxes calculated?
Very similar to the answer in regards to Luxembourg and the UK. Both countries have their own, separate tax systems for payroll, and you know really depends on the structure of the company, the employee setting and the earnings.
Can you explain more about the EU-GDPR compliance regulations for US companies?
The EU-GDPR requirements, which I mentioned earlier, are effective May 25th, and are only applicable if you have dealings with anybody who is either an EU national, or is a company based in the E.U. So, if you are a US company, only doing business in US or doing business in the rest of the world, then GDPR does not apply. But the minute you get into the situation of dealing with EU nationals, then GDPR does apply, and it does have an extensive amount of requirements, from the ability to request you to remove data, to the ability to make you “forget” or anonymize the data, among other things. Basically, you need a lot of permissions put in place before you can move the data across borders, before you can actually use it. The idea is to prevent people from selling people’s personal information for marketing and other purposes. Most companies who are doing business globally need to be GDPR compliant, or have to be before the 25th.
Do you have to pay out rollover holiday if they haven’t been used by a certain time in the following year?
In regards to rollover holiday, it varies from country to country. Two examples I will give you. In France, the time does not roll over. It’s actually covered, the mandate from the government is to use all holiday time during the calendar year. In UK, it is based on the company policy: time can rollover into the first quarter of the year.
Can you please let me know what the process looks like for opening a permanent office space in London, UK? We are a Canadian company.
The UK has started limiting the ability to really do anything except to incorporate the legal entity or a wholly owned subsidiary. So now, there are requirements in place that if you do want to open a permanent office and reside there and have representative doing business for you, then you will need to incorporate, register for the income taxes, payroll taxes, statutory benefits, and set up the payroll service accordingly. Typically, that process takes approximately 30 to 45 days from start to actually being able to execute the business plan.
We often provide an employment contract and the US offer letter because the contract doesn’t cover stock options. Do you see any problem in this?
I think that really depends again on the country. Certain places like the UK do require you to register for stock options and to deal with the tax implications. And I think in all cases I would recommend that you actually include all employment matters in the same employment agreements, and address how you hand over stock options in a specific country, because they do have tax implications, and they may require immediate payments of taxes as a consequence of the grants. And remember if you have, as an example, a local contract, and you have a U.S. offer letter out there with the same employee, you are actually opening the door to the question of which one is actually effective under whatever the clause the employee may invoke at the point of termination or other reasons. So, you do not want two letters, two contracts: you just want one. There are ways to do that very easily.
*PLEASE NOTE – These questions and answers are intended to be used for informational and guidance purposes only, not as legal advice. Set up a consultation today with a Global Upside team-member for advice and strategy specific to the unique needs of your business and geographic area.*
Co-Founder and CEO
Ragu Bhargava is an experienced financial executive, entrepreneur and leader. He is the Co-Founder and CEO of Global Upside, and its three sister companies: Global PEO Services, Mihi, and Gava Talent Solutions.
VP, Strategic Accounts
Andrew helps some of the world’s leading companies tackle complex global HR and Payroll challenges. Prior to Global Upside, Andrew worked at Price Waterhouse Coopers, Oracle and also consulted for companies like Nestle, P&G, Pepsi-Cola and Colgate Palmolive.
Director, Global Payroll
Nathan North is Director of Global Payroll and manages all aspects of payroll for Global Upside clients. Currently, he oversees payroll processing for 5000+ client employees across 45 countries.